Icahn, Antioco Appeal to Blockbuster Shareholders

Blockbuster Inc. CEO John Antioco today urged shareholders to ignore attempts by maverick investor Carl Icahn to wrest three spots on the seven-member board up for grabs at the shareholder meeting May 11, citing the elimination of late fees, online subscriptions, and movie and game trading, among other initiatives.

Last week, Icahn blasted Antioco for his “unconscionable” compensation package and “spending spree” mentality with shareholder money. He then submitted himself and two others as board nominees.

Antioco's shareholder letter, dated April 8 and included in a filing with the Securities and Exchange Commission, stressed Blockbuster's positive quarterly comps, positive growth in active members, more than 750,000 online subscribers and expanded game product and trading in the majority of its stores.

“Regardless of reports or rumors that may persist regarding what others may believe is the right approach to our business, I and our executive management team remain committed to the plans we have laid out — plans designed to build long-term success,” Antioco said.

The letter coincided with a separate SEC filing (and letter) by Icahn in which he spelled out how shareholders could vote — via a gold proxy card — for himself, retired former Warner Studios executive Ed Bleier, and Strauss Zelnick, former president and CEO of BMG Entertainment.

“We urge you not to sign any proxy card sent to you by Blockbuster,” Icahn said.

He said any proxy vote already submitted by shareholders could be revoked through the gold card, and that the board election merely required a plurality (majority) of votes cast.